Trump's history of dealmaking guides his quest for the biggest deal of his lifePosted: Jun 11, 2018 7:00 AM Updated:
(CNN) -- Donald Trump had made up his mind.
He wanted to own a fleet of airplanes that would carry his name from New York to Boston and Washington. The airline would be luxe and lavish -- fresh leather seats, marble-like counters and flights christened with champagne -- like everything else that is branded "Trump." And he didn't care how much it cost him, as long as it served to burnish his brand.
"The first day I met him -- October 4, 1988 -- he told me: 'I'm not doing this because I want to make a lot of money,'" recalled Bruce Nobles, the airline executive Trump recruited to run his Trump Shuttle.
"The shuttle operation was a New York institution. Anybody who was anybody, any of the powerbrokers in the northeast took the shuttle on a daily basis. Donald wanted all of those people flying on his airline," Nobles said.
So when the owner of Eastern Air's nearly bankrupt New York-based shuttle service refused to go lower than the $365 million price tag most experts then and now considered overpriced, Trump -- committed to the endgame -- agreed.
About a year later, Trump defaulted on the over-leveraged airline's loans amid a series of ill-advised cost overruns that coincided with an economic recession.
Now as President Donald Trump lands in Singapore for a historic summit with the North Korean leader Kim Jong Un, many of Trump's advisers quietly worry he is overly eager to ink another deal -- the biggest of his career -- that could define his presidential legacy.
The stakes this time are much higher, of course, as Trump seeks to negotiate the end to a half-century-old conflict and North Korea's decades-old nuclear program, which could soon produce a nuclear-tipped missile capable of striking the US mainland. But Trump invites the comparison to his career in business, making clear he will be leaning on decades of dealmaking when he faces Kim for the first time this week.
"I've been preparing for this all my life," Trump said as he left the White House on Friday. "I've really been preparing all my life."
So far, Trump appears to be relying on the same approach to negotiations that defined several of his key business dealings, according to nearly a dozen former business partners and experts on Trump's business career.
He has engaged in the characteristic brashness and brinkmanship that he uses to set the table for his negotiations. He has threatened to walk away from table, but ultimately stayed the course. And he is now turning to charm and relationship-building as he prepares to meet Kim face-to-face.
But as North Korea experts, US allies and the President's own advisers worry that Trump is taking a freewheeling approach to the negotiations and shirking subject matter expertise, those who have sat next to and across the negotiating table from Trump are unsurprised.
'Get it at any price' -- and ignore the experts
When Trump is eager to make a deal, everything else fades from view, explained Jack O'Donnell, a former Trump Organization executive.
"Sometimes he would say, 'Get it at any price.' When he makes his mind up that he wants something, it really doesn't matter. The economics begin to disappear for him," O'Donnell said, adding Trump would only get upset about deals made to satisfy those desires once the bill arrived.
Experts Trump hired to run his various enterprises repeatedly hit walls when their advice ran counter to Trump's gut instincts or his vision of success, like when Trump aimed to convert the commuter airline he purchased into a luxury experience, even as passengers made clear they overwhelmingly prized efficiency and reliability.
Nobles, the airline executive, warned Trump the $1 million makeover he wanted each plane to undergo would do little to attract new customers, pointing him to clear-cut survey data. Even when the overleveraged airline became tight on cash, Trump would not be swayed, instead urging Nobles to reduce the pilots per plane from three to two -- an impossibility for the airline's Boeing 727s.
"He hired me because I supposedly knew what I was doing, but he firmly believes that he's the smartest guy in the room," Nobles said. "If you tell him something that matches what he thinks, then you're a genius. Otherwise, he pretty much doesn't pay attention."
But relying on experts who disagree with him would amount to "self-betrayal," said Trump biographer and CNN contributor Michael d'Antonio, like "he's abandoning himself."
Trump grasped the fields he was interested in, such as development contracts, construction costs and promotion. But even the details of his own financial situation appeared to stump him when he faced bankers and lawyers during bankruptcy negotiations in the early 1990s.
Ben Berzin, a former executive vice president at PNC Bank who negotiated with Trump to restructure loans then, said Trump often appeared to not acknowledge the reality of his financial situation and the ramifications of making certain agreements.
"He would say things in meetings that his attorneys would have to backtrack on," Berzin said. "To the point where his attorneys would have to make sure that before any meeting was held that there was an agreement where anything that was said in meetings would not be bound until it was put into writing."
'He just goes and he does it'
Trump unprepared and off-the-cuff is what several of the President's top advisers are worried about as he arrives in Singapore. Trump has sat for several prep sessions with his advisers, namely Secretary of State Mike Pompeo who has twice met with Kim, and aides say he spends much of his time focused on the negotiations.
But he has also been skeptical of advice from career North Korea experts and has privately cast himself as knowledgeable about North Korea based on his business dealings in Asia and his sense that he understands what drives Kim.
Trump has also continued to express frustrations about the cost of maintaining a US military presence in South Korea and aides worry he could extend the promise of a US withdrawal to Kim, several sources familiar with the matter said.
"One thing to understand about Donald Trump's negotiating strategies and tactics -- and this has been a consistent theme all the way through his entire business career -- he is an incredibly instinctive, intuitive, off-the-cuff, winging-it negotiator," explained Marty Latz, the author of the forthcoming book "The Real Trump Deal."
"This is not someone who takes a lot of time to do strategy, he's not someone who's going to extensively read the research in negotiations. He just goes and he does it," he said.
Trump won't be entirely unpredictable, though, as he arrives at the Capella Hotel on Singapore's Sentosa island to sit down with Kim. Trump's instincts also push him to lean on his salesman-like charm and his instinct for relationship-building over confrontation during in-person meetings.
"He believes that the force of his personality is enough to shape the world," said D'Antonio, the author of "Never Enough" and "The Truth About Trump." "He thinks that if he shakes your hand and puts your arm around his shoulder or gives you a certain smile, that something good is going to come of it."
As President, he has often characterized the strength of the US' bilateral relationship with other countries through the lens of his personal relationship with their leaders, touting for example the red-carpeted welcome Chinese President Xi Jinping extended him during his visit to China as a sign of improving US-China ties.
In his bankruptcy negotiations in the 1990s, Trump leaned on that same view of personal ties. Berzin, one of the bankers who negotiated with Trump, said Trump sent him letters and signed pictures that called Berzin "the best and toughest banker I know."
During the negotiations, he even visited Berzin after he landed in the hospital for knee surgery. But after Berzin rejected Trump's efforts to renegotiate their agreement, Berzin became one of the "jerks" Trump referenced in a later book.
Just as Trump quickly changed his tune from calling Kim a deranged "Little Rocket Man" to praising him as "honorable" and "smart and gracious," he could quickly switch back -- and his approach to negotiations could return to one of brinkmanship.
It's a tactic he's deployed with results in business, such as when he found himself defaulting on hundreds of millions of dollars in loans in the early 1990s and offered bankers a swift warning if they sought to sink, rather than salvage, him.
A top lawyer involved in the negotiations said Trump warned the 72 banks preparing to decide his fate. "If I'm going down, you're all coming with me. There is no way you're going to survive this and I'm not," he recalled Trump saying.
The gambit worked, the lawyer said.
"If you're dealing with an individual or a person that is crazy, that person gets a lot. The damage that that person can do to your institutions is greater than whatever it would cost you to get rid of them. You really think they're taking you off the cliff, you give him whatever he wants," the lawyer said. "The only time that doesn't work is if the other guy is crazier than you are."
Ultimately, the question remains as to whether a real estate and branding mogul's skills can convert at a table of high-stakes nuclear diplomacy. He has struggled to make that application to dealmaking during his presidency and D'Antonio, the biographer who has studied Trump for more than two decades, worries they won't take in Singapore.
"He is an old dog who is not learning new tricks -- and he may not be interested in learning them," d'Antonio said. "His talent is for getting into a room and performing a role that he is very comfortable with, but it's really up to everyone else to fill in the details."
™ & © 2018 Cable News Network, Inc., a Time Warner Company. All rights reserved.